aRdent Voice

Having seen both abusive and unresponsive management/owners and the protection of mediocre and unproductive workers by unions in places I have worked, I have to say that the real problem boils down to humans and egos. Both management and unions are quite capable of ruining a firm when they let egos run amok.

In the labor-management transaction, there needs to be a deal that both sides can live with and that will neither break the firm nor take unfair advantage of the worker. The problem is that in many cases, the unions have come into play only after a history of abuse by the employer, so neither side is really bargaining without an axe to grind. Once in place, unions frequently continue to push for more and more concessions, regardless of the net effect on the health of the employer and because of the employer’s attitude towards workers, the negotiators cannot really trust or believe each other.

Some of the unions themselves are unwilling to deal fairly and openly with their own employees as detailed in this piece by Deroy Murdock in National Review. Here again, it’s all about a few people not being able to distinguish between being CEO or President and being King.

Clearly there are major abuses on both sides. The “rubber room” where some union teachers spend years whiling away the day at the taxpayer’s expense because it is so complicated and expensive to just discharge them is a current example.  But, for every example of a union procedure or benefit that seems unbelievable to the rest of us, there is a negotiator somewhere that agreed to it for that employer.

In the public sector, those seen as “management” may agree to nearly anything as they have no vested interest in the “business” anyway, since revenues are based on taxation and legislation rather than a free-market. For this reason I have some real problems with unions in the public sector, unless the union contracts are subjected to a public vote by either the people or by their elected representatives. Otherwise it is just one government employee making a deal with other government employees while no one really has the responsibility to look after the public interest.

On the other side, I once worked for a firm that kept changing the bonus criteria every other month because someone in the home office decided they were paying too much out in bonuses. The net result was that it became essentially impossible to meet the bonus requirements and the very things the bonus was set up to encourage disappeared. At the same time, pay rates were frozen and the employee share of the benefits plan shot up. Needless to say, productivity suffered greatly and absenteeism became a problem. Disappointed with that outcome, management went for the stick instead of a better carrot and several workers, myself included, started to investigate union representation. It had become clear that the firm’s priorities had changed from encouraging productivity to controlling labor expense within very tight parameters.

Republicans would have us believe that all unions are evil and that business owners and managers are all fair and honest folks who just want to make an honest profit from their efforts. Democrats would have us believe that every worker, whether in private business or on the government payroll must be protected from the evils of management and owners. Like so many other issues, neither tells the whole story. Neither side wants to tell you that most things are not black and white, because then you might actually start evaluating candidates as individuals instead of by party affiliation. To paraphrase, the fault lies not in our unions or employers, but in ourselves.

I’m really getting sick and tired of hearing every stupid statistic trotted out as Breaking News and then a flurry of  professors and so-called experts from former administrations wringing their hand about what this may or may not mean. This week it is home sales. Let’s see, unemployment still high so not many home sales, what a shocker.

The one thing that should be abundantly clear from all of this is that Washington does not control the economy, no matter how much they borrow from abroad to throw at selected industries in the name of spurring economic growth or recovery or whatever.  It doesn’t matter whether the administration is controlled by either party, the whole economic engine of the country is just too big and too complex for the goofballs in D.C. to do anything more that twiddle around the edges and drive the national debt to new heights. The only difference in the two political parties is who they give our tax money to in order to pay back campaign contributions. No amount of government spending whether on missiles and ships or teacher unions and road construction is  going to bring back a middle-class with jobs and futures and realistic hopes of retiring some day.

In the fine FDR tradition of creating an extra-legal agency to “address” every problem, the Obama administration (and their many friends wanting high-paying, low stress jobs in Washington) now want BP to pay billions of dollars into an escrow account AND have disbursement of the funds from this account administered by a third party. Anyone want to guess what this third party will look like.

OK, I’m no fan of BP. Their safety and deferred-maintenance record has not been very good in North America in the last decade or so and the continuing mess in the Gulf of Mexico is just the largest and latest.

The White House and the Dems on the Hill are behaving predictably – “Something must be done!” – even if it has little or no effect on the real problem. Not ones to let an opportunity pass, they now propose to have BP escrow billions of dollars in funds and then set up a “third party” to administer the claims on these funds.

I can only imagine how this “claim processor” will be constituted. First we’ll need a big name chief for the Wesley Mouch role, and a blue-ribbon panel of former office-holders, technical experts, legal experts, financial experts, then lots of administrative paper-pushers to build and monitor “process.” This “FreddieSpill” will almost certainly set new records for overhead eating up the available funds.

No doubt Congress will pass some special enabling legislation for FreddieSpill that puts it beyond the normal legal-judicial process so no one will be able to appeal or contest the rulings of this “third party.”

Once an entity like this is created, it will never die, so this will become the de facto liability oversight agency for the oil and gas industry in the U.S. Since this agency will be outside the normal legal process, its determinations will be impossible to predict since it is essentially a political animal, thereby dramatically cranking up the risk for US exploration and production at the very time we desperately need to find and produce energy here.

So, the net result will be lots of jobs for friends of those in the administration, a rapid whittling away of the escrow funds, arbitrary and capricious disbursement decisions that cannot be appealed in courts and a frightening risk variable on the domestic oil and gas industry.

Wow, do these people know how to make lemonade or what?